How a couple divides their property depends on their state of residence. Kentucky laws require a court to divide assets equitably. This does not mean distribution needs to be completely equal; rather, it means asset division should be handled with fairness.
Usually, a couple will seek the help of a mediator or court to help divide their assets (if they can’t agree on how to do so themselves). However, if the couple co-owns a business, there may be increased strife or disagreements over how the business should be handled.
Luckily, a court can settle this matter a few ways:
If spouses co-own a property and there is too much negative energy between them to continue a professional partnership, one spouse could buy out the other’s share. An arrangement of this type can only work if one spouse has enough capital to satisfy the selling spouse’s monetary share. For example, if the spouses co-own a restaurant valued at $200,000, the selling spouse may only agree to give up their share if the buying spouse can give them $100,000.
Assuming the spouses get along amicably, they may be able to continue co-owning their business after the divorce. For example, if the restaurant the spouses co-own holds a certain emotional value for both parties, they may decide to continue their professional relationship even though their personal relationship is ending.
In the event the spouses do not want to give up their share of the business and do not get along, they could also agree to one spouse becoming a silent partner. A silent partner is someone who does not have a hand in the day-to-day aspects of a business but continues to provide financial support.
If neither of the above methods are feasible, a beneficial option could be for the spouses to sell their business and divide the monetary value. While this may seem like the simplest option, it poses the most complications.
Issues that could arise include:
- one spouse refusing to sell their share;
- the amount of time it could take to find a buyer; or
- what the market for the particular business looks like.
A Competent Business Valuation Attorney
Attorney Winner Law Group, LLC can help you and your spouse determine the value of your business property before finalizing the divorce. He is meticulous in practice and will ensure you receive exactly what you are owed.
Contact the firm online or call at (502) 812-1889 for your legal consultation.